Eletrobras hires Credit Suisse to help sell unit assets: sources
[SAO PAULO] State-controlled power holding company Centrais Elétricas Brasileiras SA has hired Credit Suisse Group AG to advise on a plan to sell a portion or all of a subsidiary's renewable energy assets, two sources with direct knowledge of the matter told Reuters exclusively.
According to the sources, who requested anonymity because the process is private, the company known as Eletrobras expects to fetch about 2 billion reais (S$744 million) with the sale of wind farms and other assets belonging to a unit called Eletrosul.
Credit Suisse, Rio de Janeiro-based Eletrobras and Eletrosul declined to comment.
Apart from the wind farms, the assets available for sale include an electricity transmission line that is still under construction, the sources said. Eletrosul's proprietary wind farms have about 1,000 megawatts capacity, with an additional 400 MWs capacity together with partners.
With the sale, Eletrosul could raise cash to fund higher-yielding projects, said one of the sources. Still, the process could be challenging as Brazil's electricity industry struggles with declining demand and a glut of ready-for-sale assets in the renewable energy sector, the same source said.
Eletrobras has already put a power distribution utility on the block. Eletrobras may not be able to complete the divestment of Eletrosul's renewable energy assets this year, the same source added.
The sale could allow Eletrobras to raise much needed cash to reduce debt, keep funding investments and offset the impact of money-losing distribution assets on the company's balance sheet. State companies are undergoing a dearth of cash as a steep recession and an ongoing corruption probe drove revenue down and cut access to financing.
Shares of Eletrobras gained 1.9 per cent on Monday to 11.10 reais.
REUTERS
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